Getting into an auto accident not only affects you and your car but can cause a significant rise in your auto insurance rates as well. If you find yourself in the unfortunate situation of having been in an accident, it’s important to know what to expect. The cost of your insurance policy after an accident depends on several factors. Later, we’ll discuss how to reduce rates after an at-fault accident.
The average annual premium for full auto insurance coverage before an accident is $1,674 and $2,311 after an accident. This means that your insurance will go up by a whopping $637.
However, the yearly premium may go higher than the average in some states, depending on the damage caused.
A 20-year-old male can still get the cheapest available car insurance in the US, even though drivers in their 20s are considered potentially risky customers. This means that insurance companies are willing to offer low rates on auto insurance for this demographic, as they have not been proven to be a high-risk group as of yet.
According to ValuePenguin, Geico is the cheapest car insurance company for a 20-year-old male. However, there are cheap car insurance options for over 30s since car insurance rates tend to reduce as drivers get older.
Your insurer also contributes hugely to how much you pay after an accident. Therefore, you should research well to find an excellent deal before registering for a car insurance policy.
There are many cheaper car insurers in different states. Consider switching to the cheapest one in your state to enjoy affordable rates.
How Does an Accident Affect Your Car Insurance Rates?
Immediately after an accident in which you’re at fault, your car insurance rates will rise significantly. The reason is that at-fault accidents are chargeable in court since they may have caused injury/death or damage to properties. However, you can expect your rate to return to normal after three to five years.
Other insurers may charge more if the crash is bad enough, and lower if the crash is not that severe. However, to most insurers, the collision’s severity and circumstances don’t matter. They will still increase your insurance rates as long as it has happened.
In a few cases, you may also be charged more or less depending on how at fault you are. For instance, if you cause an accident while driving under the influence, this could raise your car insurance premium more than usual. You should also know that a DUI may affect your auto insurance coverage. Does auto insurance cover DUI accidents? That actually depends on your provider. With most policies, you will be responsible for covering any damages you cause in a DUI accident.
Cheapest Car Insurance Companies After a Crash
Auto insurance companies have different ways of increasing insurance rates after an accident.
For instance, the frequency of accidents matters a lot. A driver with an already bad record would pay higher than another driver in the same situation but with a clean record. Most car insurance companies do this because the former driver is more likely to cause another accident.
For this reason, you have to compare several insurance rates given by different insurers in your state to get the cheapest one after an accident. Before settling, make sure you understand everything from their rates to their policies. This way, you can avoid any surprises that might come after you’re involved in an accident.
You can clearly see the difference between these eleven top car insurance companies before and after an at-fault accident.
USAA is the cheapest among them all. It offers lower rates before and after accidents to its customers. However, USAA Auto Insurance is available only to veterans and their families and active military people.
Getting A Lower Insurance Rate After an Accident
How do you get a lower car insurance rate after you’re involved in an accident? Many drivers ask themselves this after getting involved in an accident. It will depend on several things: for example, the number of accidents you’ve been in within the past three years.
Some drivers may qualify for the accident forgiveness program from their insurers, which can save them a lot of money. Still, there are other discounts you can qualify for, such as working in certain occupations like teaching or if you drive fewer miles.
If you don’t qualify for a discount, there are still ways you can get a lower rate from your provider after an accident. One way to do so is by negotiating a car accident insurance settlement with your insurance provider and discussing the various methods to settle the cost.
Here are six ways to lower your insurance rate:
1) Deductible Increase
A driver can lower their premium rate if they pay a higher deductible. However, before you can raise your deductible, know that most of the expenses will be covered from your pocket before your insurer pays.
2) Utilize Available Discounts
As mentioned above, many auto insurance companies usually offer several discounts to their customers. Such deals include good students, safe driving, and multi-policy.
3) Improve Your Credit Ratings
In some states, car insurance companies consider your credit ratings to determine how much they could add to your rates after an accident. It’s important, then, to ensure your credit rating is good. Do this by staying within your budget, paying all your debts on time, and addressing any issues in your credit report immediately.
4) Update Your Coverage
Changing your coverage is one way of lowering your insurance rate. However, only reduce the amount of your insurance with the help of a licensed insurer. Otherwise, you might get in trouble for insurance fraud if you do not get any legal advice.
Also, ensure that you maintain the minimum insurance coverage levels from your state as you work on updating your coverage.
5) Buy A Cheaper Car
Did you know that it will cost you a whole lot more to insure expensive cars? Getting a cheaper option will reduce your insurance premiums.
6) Get A Cheaper Insurance Option
Insurance prices vary significantly across car insurance companies. There’s always one offering cheaper rates than the other. The discounts and coverage options these companies offer also vary.
That’s why you must do your shopping well, comparing everything provided by these companies to get the cheapest one. Also, don’t forget to check the insurance company policies because cheap rates won’t help if the policies are too tight.
Here are some of the things you’ll discover as you shop around for the most affordable car insurance company.
A Special Case
What happens if you get into a not-at-fault accident with a driver without insurance in Tennessee?
You can file a negligence lawsuit against the driver who caused the accident. Later, you must show and prove that the driver’s careless driving caused your bodily injuries to get compensated. Make sure you get proof in terms of photos and police reports.
You can also file a claim from your insurer if the other driver doesn’t have one.
Get Your Insurance Rates Right
While getting into an accident is inevitable, it doesn’t necessarily mean that you’ll get higher insurance rates. As you’ve seen in this article, an increase in insurance rates depends on your state and the damage you’ve caused.
There are also several ways you can lower your premiums, such as driving a cheaper car, shopping around for the best deal, improving your credit rating, etc. You can take advantage of all the above techniques to avoid increasing your insurance rates significantly.
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